By Sarthak Takyar
The solarisation of pumps will help farmers and the agricultural sector in several ways. First, it will help farmers reduce their dependence on conventional sources of energy supplied by discoms. Second, it will provide an additional source of income to farmers who will be in a position to sell the surplus power to discoms. Finally, it will help discoms reduce their burden of subsidy on the consumption of electricity in the agricultural sector and thus improve profitability. In addition, the use of solar pumps will help in ensuring the provision of uninterrupted electricity supply during the daytime, leading to more efficient farming. And the reduced use of diesel pumps will clearly have a positive impact on the environment.
Considering these advantages, the central government and a number of state governments have come up with programmes for the promotion of solar pumps.
The government’s intention was reiterated in the budget speech in February 2019. The finance minister stated that the central government will take the necessary measures in this regard and will also encourage state governments to put in place a mechanism through which state-run utilities can purchase surplus solar power at reasonably remunerative rates from farmers using solar pumps for irrigation.
Renewable Watch tracked the central and state-level programmes for the promotion of solar pumps. Some of these are described below…
On February 19, 2019, the Cabinet Committee on Economic Affairs, chaired by the prime minister, approved the Kisan Urja Suraksha evam Utthaan Mahabhiyan (KUSUM), more than a year after it was announced in the Union Budget 2018-19. Broadly, the KUSUM scheme is aimed at promoting the use of solar energy in the agricultural sector. This will be done through the extensive solarisation of existing pumps, the installation of new solar pumps, and the establishment of grid-connected ground-mounted solar power plants. According to the KUSUM website, the scheme will end in 2021.
The KUSUM scheme has a total outlay of Rs 1,400 billion, to be distributed over a period of 10 years. Of this, the central government is estimated to contribute Rs 480 billion (34 per cent). The key features of the scheme are:
- Distribution of solar pumps: The government has mandated the distribution of 1.75 million solar pumps to farmers.
- Small-scale power generation: The KUSUM scheme will also seek to replace diesel pumps with solar-powered pumps of about 720 MW.
- Power from tube wells: The government is looking to install tube wells with a cumulative capacity of 8,250 MW.
- Sale of excess power: Apart from the savings incurred by using solar pumps for irrigation, the KUSUM scheme helps farmers earn revenue by selling the excess energy from solar plants to the grid.
- Duration: According to the KUSUM website, the successful implementation of the scheme would require central government support for at least 10 years.
- Subsidy structure: In terms of the capital expenditure required for the provision of solar pumps and power generation systems, 10 per cent of the cost will be incurred by farmers, 30 per cent will come from bank loans, and the remaining 60 per cent will be provided equally by the central and state governments in the form of subsidies.
- Components of budget allocation: Initially, the central government will provide an amount of Rs 220 billion for the distribution of solar pumps. The second phase of the programme will see the infusion of another Rs 48 billion by the relevant departments. The third phase will involve the solarisation of ordinary pumps, and the central government will disburse around Rs 157.5 billion for this purpose. Apart from this, Rs 50 billion will be required for the fourth and fifth (final) phases of the KUSUM scheme.
Atal Solar Krishi Pump Yojana (Maharashtra)
Under this scheme, the Maharashtra government will provide solar pumps to farmers with a subsidy of up to 95 per cent. Farmers with less than 5 acres of agricultural land will have to pay just 5 per cent of the cost of a 3 horsepower (HP) solar pump, while farmers with more than 5 acres of agricultural land will get a 5 HP solar pump for Rs 30,000.
In addition, to encourage farmers to use solar pumps for agricultural purposes, the Maharashtra government has decided to give two LED bulbs, a fan, and a mobile-charging socket as freebies.
In a bid to promote renewable energy and expand the use of solar power in irrigation, the Himachal Pradesh government has floated the Saur Sinchayee Yojana with a budget allocation of Rs 2.24 billion. The programme is expected to provide 5,850 agricultural solar pump sets to farmers. Under the programme, 90 per cent financial assistance will be provided to individual small and marginal farmers and an 80 per cent subsidy will be given to individual medium and large farmers. Solar pumps will be provided free of cost to farmers belonging to the small and marginal category.
Surya Raitha scheme (Karnataka)
The scheme offers guaranteed buyback of surplus solar power from solar irrigation pump owners at an attractive feed-in tariff. According to the policy guidelines, farmers with a 10 HP solar pump can earn nearly Rs 50,000 per annum. The pump sets will be connected to agricultural feeders with net meters. The net consumption is accounted for monthly and the commercial settlement is done on a half-yearly basis.
Saur Pump Yojana (Bihar)
In the first phase of this scheme, five districts were covered (Kosi region) and 560 pumps of 2 HP (both Alternate Current and Direct Current) were sold. In the second phase, 11 districts were aimed to be covered and the target was to sell 1,000 pumps. Under this scheme, the Ministry of New and Renewable Energy provides a 30 per cent subsidy and the state government provides a 60 per cent subsidy. The remaining 10 per cent of the cost is paid by the end user.
Solar pump voltaic irrigation pump scheme (Uttar Pradesh)
Under the scheme, financial assistance for DC pumps with a capacity of up to 2 HP and for those between 2 HP and 5 HP is fixed at Rs 50,820 and Rs 80,996 respectively. In the case of AC pumps of capacity of up to 2 HP and for those between 2 HP and 5 HP, the state government gives subsidy of Rs 51,840 and Rs 77,700 respectively.
For this policy, as in the case of other similar policies in other states, the state government has focused on giving high capital subsidies. For small and marginal farmers purchasing polar pumps with a capacity of 2-3 HP and 5 HP, the expected capital subsidy is 70 per cent and 40 per cent, respectively.
Meeting the RPO (Maharashtra)
In March 2019, the Maharashtra Electricity Regulatory Commission (MERC) issued an order stating that the power generated by off-grid solar water pumps will be counted towards meeting the renewable purchase obligation of Maharashtra State Electricity Distribution Company Limited (MSEDCL).
The MERC gave permission for this order after noting that off-grid pumps have provision for an online monitoring mechanism through which the details pertaining to the operation of the solar pumps are automatically made available to MSEDCL. This is a positive move by the state regulator and will provide a fillip to the sale of off-grid solar pumps.